A dispute over the ownership of the name of ‘iPad’ has been settled in China with Apple shelling out $60 million, as announced by Guangdong High People’s court. This will help clear the way for Apple in the sales of the iPad 3 in Chinese markets.
Shenzhen Proview Technology was in dispute with Apple, with the latter claiming to have purchased global rights of the iPad name from the former back in 2009. However, Chinese authorities argued that a transfer of these rights in China never really happened. A ruling in December went in favour of Proview, declaring that Proview still owned the rights to the name in China. Proview, a financially struggling company, had supposedly appealed to Chinese officials, asking them to seize iPads to pressurize Apple into a settlement.
With Apple transferring $60 million, the dispute has been declared as resolved by Chinese courts. Even though Apple paid $55,000 for securing rights of the name in various countries from an associate of Proview in Taiwan, it was unclear if Apple had acquired rights to the name in China, giving rise to the dispute. The iPad trademark had been registered by Proview in 2001 in China. Xie Xianghui, Proview’s lawyer, stated that though his company was hoping for a settlement as much as $400 million, but they had to make do with what was given as they are heavily burdened by debt.
Shenzhen Proview Technology is a subordinate of Proview International, a maker of LCD screens with its headquarters in Hong Kong. According to a Hong Kong court ruling, Proview and the Taiwan company had cleverly worked against Apple, refusing to transfer the name as per the agreement. However, the ruling had no force since Hong Kong has a separate legal/judicial system.
With the settlement made, Apple can start selling their iPad 3 in Chinese markets. After the US, China continues to be Apple’s second largest market, contributing to the growth in sales in large numbers. The sales of the iPad in China will help Apple compensate for the $60 million they have shelled out. The settlement of this dispute will also be welcomed by the communist government which is constantly looking to gather technology investors as a means of providing a boost to China’s economy. However, with the results going against Apple, it may ward off other technology investors who are unable to understand how Chinese courts intend on handling similar disputes in the future.